"I'm talking about people right at the top. I'm talking about people with incomes of many millions of pounds a year.

"The general principle is that people should pay income tax and that includes people with the highest incomes."

Charities have warned that limiting tax relief on donations will reduce philanthropic giving.

But Mr Osborne said: "I was very clear in the Budget that we are specifically looking at making sure we are still encouraging philanthropy and charitable giving. But that is a specific issue we can deal with."